Season 2: Episode 1 - Should I Be Doing Roth Conversions?

Everyone is talking about Roth conversions right now, but most people only hear the hype and miss the parts that actually move the needle. In this episode, we get specific about what a Roth conversion is, why it can be one of the biggest “engines” for moving wealth from the pre-tax bucket to the tax-free bucket, and why the real win is control: control over taxes, control over required minimum distributions, and control over how retirement income shows up on your tax return. We walk through the practical reasons to consider converting, including reducing future RMDs, creating tax-free retirement income after 59½, and improving legacy planning for the people you’ll one day leave assets to. We also connect the dots on provisional income and why Roth distributions can help limit how much of your Social Security gets taxed, which can be a massive difference in a real retirement plan. If you’ve heard the phrase “rich man’s Roth,” we explain what that means and why conversions are effectively unlimited even when Roth IRA contributions are not. Then we dig into the rules and the traps: paying the tax bill the smart way, avoiding underpayment penalties when you convert late in the year, and understanding the five-year rule so you don’t trigger a 10% penalty by grabbing converted dollars too soon. We also get into the nuance that most soundbites ignore: tax bracket strategy (including why the 22% to 24% space can be a sweet spot for many) and Medicare IRMAA surcharges that can raise Part B premiums based on your income from two years prior. If you’re thinking about a Roth conversion, or you’re not sure whether it fits your lifestyle, tax bracket, or estate goals, this is the roadmap. Subscribe, share this with a friend who’s nearing retirement, and leave a review with your biggest Roth conversion question so we can tackle it next. ---------------------------------------------------------------------- Disclosure: Information contained in this podcast is for entertainment and informational purposes only, and should not be considered as financial advice. Financial Planning and Advisory Services are offered through Prosperity Capital Advisors (“PCA”), an SEC registered investment adviser. Registration as an investment adviser does not imply a certain level of skill or training. Keystone Financial Group and PCA are separate, non- affiliated entities. PCA does not provide tax or legal advice.